Name and Location
Renard diamond project, Quebec, Canada.

Client
Stornoway Diamonds.

Project Description
The Renard diamond project is located about 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau, in the James Bay region of north-central Quebec.

The project hosts probable mineral reserves, as defined under National Instrument 43-101, at 17.9-million carats. The total indicated mineral resources, inclusive of the mineral reserve, are 27.1-million carats, with a further 16.9-million carats classified as inferred mineral resources, and 25.7-million carats to 47.8-million carats classified as no-resource exploration upside. All kimberlites remain open at depth.

The November 2011 feasibility study included ramp and shaft access to the Renard underground mine. According to the optimisation study released in January 2013, shaft sinking will be deferred until later in the mine life and access to the underground mine will be through a ramp only.

The shaft will be developed to a depth of 610 m, sufficient to extract all mineral reserves and the inferred mineral resources. It will also be enlarged to accommodate the planned production rate of 6 000 t/d of ore. Ore will be hauled to surface by 60 t trucks, with ramp ventilation capacity and surface maintenance facilities expanded to accommodate the increased fleet. Plant capacity remains at 6 000 t/d, expandable to 7 000 t/d. Power requirements, provided through on-site diesel power generation, are expected to total 12.2 MW during operations.

According to the optimisation study, diamond production in years 1 and 2 will be derived predominantly from the Renard 2/3 openpit. Diamond production from the underground mine will start during year 2. As indicated in the feasibility study, underground ore will be mined, with blast-hole shrinkage on the 250 m, 430 m and 610 m development levels and waste backfill from surface. The optimisation study contains a refined draw-point design and a mining sequence, incorporating a panel-retreat method to better ensure geomechanical stability and mitigate the unexpected onset of natural caving.
Renard is expected to produce ore at a rate of more than 2.16-million tonnes a year, producing on average 1.6-million carats a year.

Value
As a result of design changes to the project, preproduction capital costs are estimated at C$752-million, a reduction of C$50-million from the previous estimate.

Duration
First production is expected in the second quarter of 2017.

Latest Developments
Global engineering, procurement, and construction management (EPCM) firm SNC-Lavalin has won a C$425-million contract to oversee construction of Stornoway’s Renard project.

SNC-Lavalin will provide EPCM services for the mineral processing plant, a liquid-natural-gas power plant and other on-site utilities, including service buildings, water treatment facilities and infrastructure. SNC-Lavalin previously participated in the front-end engineering phase of the project, which began in 2012.

After successfully closing the project's comprehensive C$946-million financing package, Stornoway earlier this month announced its decision to build the Renard project, which had been in the making for 18 years.

SNC-Lavalin has started mobilising the Montreal-based project team, while construction is scheduled to conclude by December 2016. The team will incorporate specialised diamond processing and recovery know-how by engaging with DRA Americas and Amec Americas.

Key Contracts and Suppliers
SNC-Lavalin (EPCM).

On Budget and on Time?
The cost of the project has been reduced by C$50-million. Plant commissioning has been postponed by six months.

Contact Details for Project Information
Stornoway Diamonds director of investor relations Orin Baranowsky, tel +1 416 304 1026 ext 103or email info@stornowaydiamonds.com.
SNC-Lavalin, tel +1 514 393 1000 or fax +1 514 866 0795.